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Mercury Computer gets $200 million revolver with $50 million accordion
By Toni Weeks
San Diego, Oct. 17 - Mercury Computer Systems, Inc. entered into an agreement for a five-year $200 million senior unsecured credit facility on Oct. 12 with KeyBank NA as administrative agent, swingline lender and letter-of-credit issuer, according to an 8-K filed Wednesday with the Securities and Exchange Commission.
The agreement provides for a $200 million senior unsecured revolving line of credit and includes an accordion feature, which may be accessed for an additional $50 million of borrowings under an incremental revolver or a term loan.
The credit agreement expires Oct. 12, 2017.
Borrowings will bear interest at Libor plus a margin that depends on the company's leverage ratio. The margin will be 225 basis points if the leverage is greater than 3.25 times, 210 bps for leverage greater than or equal to 2.5 times but less than 3.25 times, 190 bps for leverage greater than or equal to 1.75 times but less than 2.5 times, 175 bps for leverage greater than 1 times but less than 1.75 times and 150 bps for leverage less than 1 times. A commitment fee, also based on leverage, will be 30 bps if the leverage ratio is greater than or equal to 2.5 times and 25 bps if it is less than 2.5 times.
The agreement provides for a maximum leverage ratio of 3.5 times and a minimum interest coverage ratio of 3 times, both based on consolidated EBITDA for each consecutive four-fiscal-quarter period after giving pro forma effect for any acquisitions or dispositions.
Proceeds may be used for working capital, acquisitions and general corporate purposes. The company did not draw funds under the revolver at closing, the filing noted.
TD Bank, NA and U.S. Bank NA are co-syndication agents and, with Keybank, joint lead arrangers and joint bookrunners. Sovereign Bank, NA is the documentation agent. Bank of America, NA and Union Bank, NA are additional lenders.
The company also said that it terminated without penalty its loan and security agreement with Silicon Valley Bank dated Feb. 12, 2010, which provided for a $35 million revolver.
The Chelmsford, Mass., company makes computer products for real-time digital signal and image processing.
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